The Beveridge Report of 1942 and the Welfare Act

The Britons were already thinking ahead to postwar reconstruction, despite the fact that the Battle of Britain still hung in the balance.  They were determined to avoid the failure following World War I.  Instead they want to make good the pledge that Britain should be a land ‘fit for heroes to live in.’  The government wanted more than the restoration of peace, hence extend beyond it, considering the actuality that the population of danger and sacrifice, and the expanded government powers necessitated by total war.  There were a number of commissions within and appointed by government for the investigation of the anticipated postwar problems.  Perhaps the most important, chaired by Sir William Beveridge (1879-1963), dealt with “Social Insurance and Allied Services.”

The Labor politicians who took power in the final weeks of World War II were determined to build what they called "the New Jerusalem."  To do so, they would apply the lessons of history and transform the role of government.  Building on wartime experiences and institutions, they would make government into the protector and partner of the people and take on responsibility for the well-being of its citizens to a far greater extent than had been the case before the war.  Moreover, Labor had the blueprint at hand.  Economical and Social and Political theorist, Beveridge’s contribution and the work of the Beveridge Committee was of monumental significance in the creation of the Welfare State.  There is renewed interest worldwide in the merits and demerits of welfare state policies.  An historical appraisal is vital to the task and also fundamental to understanding modern social and economic policy.  

The Second World War witnessed an acceleration of many trends evident in British politics and society before 1939.  The war further stimulated new industries as well as reviving the old ones, and led to widespread recognition of social problems such as poverty and unemployment. 

The Beveridge Report, presented to Parliament and published in December 1942, contained goals far more meaningful to the average Briton than the generalities of the Atlantic Charter.  It was a radical report.  From the outset Beveridge (1942) insisted that war provided an opportunity to make good:   

‘Now, when the war is abolishing landmarks of every kind, is the opportunity for using experience in a clear field.  A revolutionary moment in the world's history is a time for revolutions, not for patching.’   

It provided a summary of principles necessary to banish poverty and ‘want’ from Britain - Beveridge's mantra throughout the report was ‘Abolition of want.’  The paper proposed a system of social security which would be operated by the state, to be implemented at war's end.  Britain should have a “comprehensive policy of social progress,” for the elimination of "Disease, Ignorance, Squalor and Idleness (Beveridge, 1942).”  Required were a comprehensive and compulsory scheme of insurance to replace the present array of specialized programs and a system of “children’s allowances” to adjust earning power to family needs.  The proposal was not that the state should assume complete responsibility for all needs.  Rather there should be a cooperative venture of individuals and government working together.  All subjects would be equal in the premiums they paid and in the benefits they received.  The report met with immediate acclaim in Britain and abroad, almost everywhere.  That is except in the British government.  In the crisis year of 1942, it was not surprising that Churchill was absorbed with the conduct of the war and not with the problems of peace and reconstruction.  Although he later spoke in favor of an insurance scheme that would provide security for all “from the cradle to the grave,” his attitude toward the report remained cool and uncommitted.  The Labor party, however, was quick to endorse the report and eagerly awaited the postwar election.  When the election came in 1945, the voters remembered the offenses of the Conservative-dominated governments between the wars and the failure of Churchill to accept the challenge of the Beveridge Report.  Instead of honoring the hero for his triumphs in war, they looked to the Labor party, whose election slogan invited, “Let us face the future.” 

The notion of the welfare state refers to the state's provision of public measures and support to achieve basic living standards and help those in need across society.  Ideally, the welfare state aims to alleviate poverty, reduce inequality, and accomplish greater social integration and solidarity.  

The Beveridge Report was designed to counter the five giants of illness, ignorance, disease, squalor, and want.  The Beveridge Report is also considered the complete question of social insurance, arguing that want could be abolished by a system of social security organized for the individual by the state.  Beveridge recommended the establishment of a national health service, national insurance and assistance, family allowances, and stressed the importance of full-employment.  The Beveridge Report of 1942 proposed a system of National Insurance, based on three 'assumptions' – family allowances, a national health service, and full employment.  This became a major propaganda weapon, with both major parties committed to its introduction.  During the war, the coalition government also committed itself to full employment through Keynesian policies, free universal secondary education, and the introduction of family allowances.  The Labor Government was elected in 1945, and introduced three key acts – the 1946 National Insurance Act, which implemented the Beveridge scheme for social security; the National Health Service Act 1946; and the 1948 National Assistance Act, which abolished the Poor Law while making provision for welfare services.  These Acts were timed to come into force on the same day, 7th June 1948.  The 1948 Children Act was another important element.  

The key elements of the “Welfare State” after 1948 were understood as being Social Security, Health, Housing, Education, and, Welfare and children (the 'personal social services').  Contemporary arguments emphasized the inter-related nature of these services, and the importance of each for the others.  However, the administrative division between services was reinforced by reactions against the unifying and all-embracing nature of the Poor Law, which led to a strong distinction being made between income maintenance, health and welfare services. 

The “Welfare State” was not intended to respond to poverty; that was what the Poor Law had done.  The main purpose was to encourage the provision of the social services on the same basis as the public services - roads, libraries and so forth - an 'institutional' model of welfare.  Criticisms of the Welfare State in later years, however, were to concentrate increasingly on the problem of poverty, and debates in the UK are increasingly residual in tone. 

Although not entirely as Beveridge wished, the measures were adopted and formed the basis of the British post-war Welfare State.  Family allowances were enacted in 1945, and National Insurance and the National Health Service in 1946; full employment became government policy.  Together, these developments created the welfare state, a system of social security guaranteeing a minimum level of health and social services.   

In the process of compiling the Report, Beveridge looked in detail at many early attempts to pass legislations to make provision for social need.  During the 1880s, in Germany under Bismarck, after considerable controversy, the first steps were taken towards elementary provision for accident, sickness, old-age and disability insurance.  In Britain, under Lloyd George in 1911, legislation was passed for sickness and invalidism insurance and then unemployment insurance.  This was the result of the work of Sidney and Beatrice Webb, the Fabian Society and trade union representatives.  

The US Wisconsin Plan also pre-empted Beveridge.  Beveridge looked at these and other relevant plans, legislations and economic and social analysis. Particularly in the economic field, the work of the Beveridge Report is of international relevance.  Welfare Statism is often thought to be contrary to Classical Economics and is still hotly debated.  

Above all the work of Beveridge is best remembered for the beginning of the Social Services administration and the Welfare State in Britain, the formation of the National Health Service and the desire to tackle the difficult problems of unemployment.  Beveridge also argued for new rates of payment and intended that benefits and contributions should vary according to the cost of living, and to the number of people out of work. These arguments are still very relevant today. 

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